Collins Foods Limited · ASX:CKF
Collins Foods — HY19 Earnings Presentation
28 slides from Collins Foods's earnings presentation, Nov 28, 2018
Slide 1: HY19 Results
COLLINS For personal use only FOODS LIMITED HY19 RESULTS 28 NOVEMBER 2018 ACN 151 420 781
Slide 2: Strong growth delivered across key financial metrics
Strong growth delivered across key financial metrics For personal use only HY18 HY19 HY19 HY19 Change • Revenue up 27.6% to $411.0m Underlying Statutory Significant Underlying (1) items • Underlying EBITDA up 31.7% to $53.7m ($m) (2) Revenue 322.1 411.0 411.0 27.6% ↑ • Underlying NPAT up 25.9% to $2
Slide 3: HY19 operational overview
HY19 operational overview For personal use only Australia Europe Australia Australia • Revenue growth of 21.9% • Same Store Sales (SSS) of (2.5%) • First Taco Bell, Annerley, Brisbane • Sizzler Australia SSS growth of 4.6% continues to trade ahead of • Same Store Sales (SSS) growth of • Sales in Ger
Slide 4: KFC Australia
For personal use only Page 3 KFC Australia
Slide 5: Strong growth for KFC Australia across all key financial metrics
Strong growth for KFC Australia across all key financial metrics For personal use only HY18 HY19 HY19 HY19 Change • Revenue up 21.9% to $330.0m Statutory Statutory Significant Underlying items (1) • Overall SSS growth of 3.1% using Yum! methodology Restaurants • EBITDA up 23.5% to $56.1m, EBITDA mar
Slide 6: Innovation and great value at the forefront of KFC Australia
Innovation and great value at the forefront of KFC Australia For personal use only CORE PRODUCT INNOVATION Exciting twists and variations on existing products GREAT VALUE Value offers contribute to strong growth Page 5
Slide 7: Operations, delivery and digital a key focus for KFC Australia
Operations, delivery and digital a key focus for KFC Australia For personal use only OPERATIONS DELIVERY / DIGITAL • Incremental sales driven by improvement in speed of service and focus • 44 restaurants currently operating with delivery, with sales performance on consistency of customer experience:
Slide 8: KFC Australia restaurant build in line with development agreement
KFC Australia restaurant build in line with development agreement For personal use only • HY19 capex of circa $10.3m for KFC Australia network development: - 2 new restaurant openings in Queensland during the half year with 2 more opening subsequent to the half year Pimpama, QLD - 19 major remodels
Slide 9: KFC Europe
For personal use only Page 8 KFC Europe
Slide 10: Growth dampened by unusually hot European summer
Growth dampened by unusually hot European summer For personal use only HY18 HY19 Change • Revenue of $56.9m reflecting a full half-year of revenue from the Underlying (1) Statutory (2) Netherlands restaurants Restaurants • Europe SSS of (2.5%) half year (no.) 31 35 4↑ • Europe SSS growth was impacte
Slide 11: Transaction growth through value and innovation
Transaction growth through value and innovation For personal use only VALUE AND SNACKING INITIATIVES IN GERMANY STRONG INNOVATION AGENDA IN THE NETHERLANDS • KFC Goodies currently in test to develop snacking and late night • Customer innovation via 100% integration of kiosks, implementation dayparts
Slide 12: KFC Europe progress update on development strategy
KFC Europe progress update on development strategy For personal use only • Optimise development strategy focusing on drive throughs • HY19 capex of circa $2.2m for KFC Europe network development: - 2 new restaurant openings in Germany (Moers on 30 April 2018 and Duisburg on 11 May 2018) - 2 major re
Slide 13: Taco Bell
For personal use only Page 12 Taco Bell
Slide 14: Successfully opened second Taco Bell restaurant in Robina, QLD
Successfully opened second Taco Bell restaurant in Robina, QLD For personal use only • Opened second restaurant in Robina, Queensland on 3 November 2018 • Robina is trading ahead of expectations during the first 3 weeks • Economic model delivering to expectations • 2 further restaurants will be open
Slide 15: Taco Bell brings exciting new products and customer experiences
Taco Bell brings exciting new products and customer experiences For personal use only #tacombi International Taco Day Page 14
Slide 16: Taco Bell expansion and development update
Taco Bell expansion and development update For personal use only • Opened Robina, Queensland on 3 November 2018 • 2 further restaurants will be opened in Queensland prior to end of calendar year at Cleveland and North Lakes • Entered into a Development Agreement with Taco Bell (a subsidiary of Yum!
Slide 17: Sizzler
For personal use only Page 16 Sizzler
Slide 18: Sizzler Australia and Asia continues to deliver solid earnings
Sizzler Australia and Asia continues to deliver solid earnings For personal use only • Overall revenue down 7.6% driven by 2 fewer restaurants HY18 HY19 Change Statutory Statutory compared to prior half year Restaurants • Sizzler Australia SSS growth of 4.6% year end (no.) (1) 14 12 2↓ • EBITDA of $
Slide 19: Sizzler continues to make a strong contribution
Sizzler continues to make a strong contribution For personal use only • Sizzler Australia restaurant numbers in decline although still positively contributing to earnings JAPAN • Sizzler Asia continues to grow in both existing restaurant sales and new builds 9 CHINA • Total of 73 restaurants in Asia
Slide 20: Financial overview
For personal use only Financial overview Page 19
Slide 21: Strong operating cash flow supporting growth
Strong operating cash flow supporting growth For personal use only $m HY18 HY19 • Net operating cash flow of $35.8m up $8.6m on prior half year Net operating cash flows before interest and tax 40.0 49.9 • Capex cash spend of $16.3m: Net interest paid (3.6) (5.4) - new store and remodels circa $14.0m
Slide 22: Reduction in net leverage ratio
Reduction in net leverage ratio For personal use only Net Debt / Net Leverage Ratio (1) 250 2.75 • Net leverage ratio at 2.08 227.2 226.2 2.50 • Net leverage ratio covenant maximum of 2.75 200 Net Leverage Ratio 2.25 • Net debt of $226.2m Net Debt $m 150 133.1 2.14 2.00 • Current facility circa $368
Slide 23: Healthy balance sheet
Healthy balance sheet For personal use only 29-Apr-18 14-Oct-18 • Cash balance up $2.2m to $62.7m following completion of $m Netherlands and Australian acquisitions Cash and equivalents 60.5 62.7 • Property, plant and equipment up $2.8m mainly due to new Total current assets 72.9 77.9 restaurant bui
Slide 24: Priorities for second half of FY19
Priorities for second half of FY19 For personal use only KFC AUSTRALIA KFC EUROPE TACO BELL AUSTRALIA Broaden home delivery network Enhanced value proposition and greater brand Establish and build the Taco Bell brand in Australia awareness in Europe Expansion of digital platform Open a fur
Slide 25: Questions
For personal use only Page 24 Questions
Slide 26: Appendix
For personal use only Page 25 Appendix
Slide 27: HY18: significant items summary
HY18: significant items summary For personal use only Acquisition costs EBITDA EBIT NPAT ($m) • Aggregated costs for the following acquisitions: Acquisition costs: - 5 restaurants in WA, with a further 23 to be acquired by year Due diligence and legal advice 0.5 0.5 0.5 end in WA, SA and TAS Structu
Slide 28: Disclaimer
Disclaimer For personal use only This presentation contains forward looking statements which may be subject to significant uncertainties beyond CKF’s control. No representation is made as to the accuracy or reliability of forward looking statements or the assumptions on which they are based. Circums